Friday, November 07, 2008

Nickled and Dimed

Mayor Johnny One Note is singing his favorite tune-and the reverberation will eventually threaten to deafen-if not bankrupt-all New Yorkers. As we have been mentioning, the mayor now wants to raise about $16 million a year by taxing paper bags. Here's the NY Times reports: "In its struggle to make New York more green, the Bloomberg administration has tried discouraging people from using plastic bags. It has taken out ads beseeching residents to use cloth bags and set up recycling bins for plastic bags at supermarkets. But now the carrots have been put away, and the stick is out: Mayor Michael R. Bloomberg has called for charging shoppers 6 cents for every plastic bag needed at the register."

What's messed up about this is that the city council has already passed, and the mayor has signed, a plastic bag recycling bill; something that this tax would obviate: "Several City Council members said they were intrigued, but needed to see more details. Several did note, however, that it was only a few months ago that the Council passed — with the help of environmentalists and plastic bag manufacturers — a law requiring all stores that provide plastic bags to accept plastic bags for recycling, with some exceptions."

In our view, this is just the beginning-and the mayor's tax reflex just getting started-and calling it a "fee" will not alter the impact here: "Bloomberg officials say the proposal remains a work in progress. But for now, the plan is to charge customers 6 cents a bag at the point of sale, with 1 cent going to the store owner as an incentive to comply, said Marc La Vorgna, a Bloomberg spokesman. The officials did not elaborate on the mechanics of how the money would be remitted to the city, or how the law would be enforced. It sounds like a tax, but officials call it a fee. The distinction is important: A fee requires approval only from the City Council, while a tax requires approval from the State Legislature."

There's little question that the tax is not only regressive, but that it will have a negative impact on the local retail economy-the fee would apply to even the smallest stores-at a time when so many New Yorkers are suffering; this is the wrong way to address a budget meltdown-and the upcoming additional levies will no doubt be even more onerous: "At the 2000 N.Y. Deli on Second Avenue at 103rd Street in East Harlem, the owner, Sammy Ali, 30, said his customers would balk at paying for plastic. “No way,” Mr. Ali said on Thursday. “They ask us for plastic bags for free as it is. When we say no, they curse us out. They demand a bag for a 25-cent bag of chips.”

And the industry's concerns are legitimate: "A tax on plastic shopping bags would be regressive, with the most severe impacts on those who are least able to absorb them,” said Keith Christman, senior director of packaging for the American Chemistry Council, a manufacturers’ lobby. “There are better ways to protect the environment, to encourage sustainable choices and to support recycling without making it harder for those who are already struggling to make ends meet in a difficult economy.”

Mike Bloomberg, who no one believes buys his own groceries-or anything else, for that matter-needs to understand that not everyone is a Whole Foods shopper; and that supermarkets in particular are struggling to stay in business because of the cost of operating in this city. In this regard, the bag charge illustrates clearly how supermarkets, and their customers, are being nickeled and dimmed in NYC. As the NY Daily News points out: "Bloomberg is a piece of work," ClemeldaGipson, 39, said outside a D'Agostino grocery store in Chelsea. "Food is expensive and now we have to pay for the bags, too? They should try to come up with ideas and solutions and not just more taxes."

And here's the twit who came up with the idea-an eco-freak with no clue about the city's local economy: "They're charging sales taxes already. There's not some massive new overhaul or bureaucracy that's needed," said RohitAggarwala, Bloomberg's head of environmental affairs."

Here's someone with no idea how the city works-and he's contemplating a deposit refund to the store of a penny that will cause a great deal of bookkeeping confusion. As the Times tells us: "Bloomberg officials say the proposal remains a work in progress. But for now, the plan is to charge customers 6 cents a bag at the point of sale, with 1 cent going to the store owner as an incentive to comply, said Marc La Vorgna, a Bloomberg spokesman. The officials did not elaborate on the mechanics of how the money would be remitted to the city, or how the law would be enforced."

Sometimes it is the little things that reveal some big picture comprehension; and the nickel bag tax may be just that kind of epiphany for New Yorkers-revealing to them just what kind of a narrow minded and governmentally challenged leader Bloomberg really is. It's also an idea that has led to a loss of revenue in other municipalities, leading us to believe that the bag tax is really simply another Bloomberg environmental intrusion that underscores his lack of concern for how over regulation cripples the local economy.